Billion-dollar fund manager plans MMJ investment trust

First Trust Portfolios, an Illinois-based fund manager that oversees more than $100 billion, has filed paperwork to establish an investment vehicle containing medical marijuana stocks.

The move underscores how mainstream investment firms increasingly are targeting the cannabis industry.

In a filing with the Security and Exchange Commission, First Trust spelled out its plans for a Medical Cannabis Portfolio Series – FT 6766, which aims to achieve above-average capital appreciation. According to the filing, FT 6766 is a series of a unit investment trust, itself a fixed portfolio of securities such as stocks.

Forbes reported the MMJ stocks in the trust will be selected from a cannabis index comprised of publicly listed companies that hasn’t yet been created. The trust’s prospectus still needs SEC approval.

According to Forbes, First Trust manages $105 billion through unit investment trusts and exchange-traded funds, among other funds and accounts.

The Bank of New York Mellon is the trustee, and the trust terminates on June 28, 2019. There will be a minimum purchase amount of $1,000 and each unit will cost $10.

In a related development, a marijuana exchange-traded fund, Horizons Medical Marijuana Life Sciences ETF, began listing on the Toronto Stock Exchange in April under the ticker symbol HMMJ. Canadian-based Horizons ETF Management launched the fund.